mobile-menu-icon
GM Authority

GM In The Black For Q1 2014 Despite $1.3B In Recall Costs, Market Share Shrinks

This morning, General Motors reported a net income of $125 million, down 86 percent on a year-over-year basis, though still marking the company’s 17th consecutive profitable quarter. The Q1 results would have been higher, if not for the $1.3 billion spent on all of the recalls that took place at the end of the quarter. Revenue for the automaker rose to $37.4 billion, up from $36.9 billion a year earlier, beating analyst estimates.

In Europe, GM’s loss widened from $152 million to $284 million as GM incurred restructuring costs associated with reducing production capacity, but things seem to be improving faster than anticipated. Meanwhile, pre-tax profits at GM’s International Operations division fell 47 percent to $252 million, while Chinese market profits rose 9 percent.

GM’s South American division posted a pre-tax loss of $156 million in the politically-volatile region — a figure that does not include $419 million in charges associated with Venezuelan currency fluctuations.

Lastly, GM’s Q1 global market share fell 0.2 percent to 11.1 percent from 11.3 percent a year ago. While the company gained in Asia, Middle East and Africa from 9.8 percent to 10 percent, GM’s U.S. market share fell from 17.7 percent to 17 percent.

Former staff.

Subscribe to GM Authority

For around-the-clock GM news coverage

We'll send you one email per day with the latest GM news. It's totally free.

Comments

  1. Not surprised that profit took a dive, but market share fell? This has been happening since January of this year, come on.

    Reply
  2. Stronger pricing from GM’s redesigned trucks helped add $1.7 billion to GM’s bottom line in North America, compared to the first quarter of 2013.

    GM’s average transaction price in the United States rose by about $2,000, on average, to $32,794 a vehicle in the first quarter. Average U.S. transaction prices for GM’s light trucks rose by about $5,000 to $38,675, the company said.

    $5000 is huge.

    Reply
    1. Why the thumbs down?

      Just stated facts from auto news.

      Reply
  3. 62vette, I am guessing the thumbs down re: transaction prices came from a prospective GM customer who was just quoted a price north of $40k for a Mexico built pickup with a 4.3L pushrod V6.

    GM does need to get more realistic in pricing unless they want to lose more market share. When the GMT 900 came out in 2007 (pre bankruptcy), combined Sierra and Silverado sales numbers briefly beat the F-series. Today (post bailout) an old F-series is handily outselling the brand new GM twins almost two to one.

    ‘Authority asked a year and a half ago if the new Silverado / Sierra could threaten the F series’ sales dominance and answer was an emphatic no even before we knew about the insane pricing. Anyone who wasn’t openly underwhelmed by the boring styling, lack of a diesel option, same size pushrod engines, was being dishonest.

    Reply
    1. To be fair, Ford and Ram aren’t selling their trucks. They are giving them away. To add to that, I really like the new ECOTEC3 4.3L V6. It is very responsive, fuel efficient, and capable. Only thing GM can do next with it is add iVVL and boost the power to 300HP/310FT-LBS. There are a couple of 0-60’s online and they sound great! When are you going to quit? Aren’t you getting sick and tired of repeating the same things over and over again? We all know that pushrod engines are much better than dohc’s anyways. It isn’t like you are going to change our minds.

      Reply
      1. More low end torque, less moving parts to service, proven design, no turbos to over heat and crack, has the potential to squeeze out a lot more power than advertised, couldn’t ask for more in a small engine. Plus this engine is really meant for people ordering the trucks in work truck trim level, and don’t want to spend a lot of money on their truck. Oh and for the record, has anyone here seen the 0-60 time in a single cab wt silverado with the 4.3?

        Reply
    2. New products have gotten more and more expensive since cars were invented. This is nothing new. New F-150 will also escalate in price, just watch. The trucks are also built in Fort Wayne, Indiana and Flint, Michigan.

      And it’s starting to become pretty clear that GM is aiming for profits and ATP over sheer sales volume with this line of trucks, which actually share a lot of commonalities with the GMT900 models. They probably don’t care as much as we’d like to think. To quote one PR official “we’re just fine being No. 2 in trucks.” Besides, while GM might not dominate the truck segment, they practically own the evermore important crossover/SUV segment in America.

      Reply
  4. Giving them away?? The Ram 1500 Diesel that sold out 8000 units in three days in orders, yeah, that’d all be be full MSRP on each end every one! Those are pushing $60k a piece I think.

    The things you say about the 4.3 make me think you haven’t driven a non GM truck recently. I’ve driven a new 5.3 that almost made me go to sleep, and the 4.3 gets the same highway mpg and in theory one more mpg in the city so where’s the advantage?

    But why listen to me? The competition is gaining sales while GM is losing sales. Ya think there’s a reason or two for that?

    I predict zero percent fininacing in the near future with GM being backed into their own (also overpriced) Colorado / Canyon pricing territory. The trainwreck will be complete.

    Also, the one who keeps up with me in repeating things here is you.

    Reply
    1. 8,000 truck in the North American market are what percentage of all trucks sold?

      Now sell 200,000 of them at full sticker and then came back and brag.

      Reply
      1. 8000 trucks were ordered for inventory, not sold. Only 400 were sold.

        Reply
    2. Ok now we have 2 different data points.

      8000 diesels at full msrp sold OR 400 sold.

      Let’s see data sources. Put up or shut up. Let’s see who has made up data to make their opinions fit their subjective view and who has objective data that they use to form objective views?

      Reply
      1. Reply
      2. From AutoNews and PUTC:

        “DEALERS ORDER 8,000 EcoDiesels in First Three Days…….Included in the orders placed between Feb. 7 and 10 were more than 400 diesel-powered half-ton pickups that had already been SOLD to customers.”

        Reply
        1. So they had 7600 trucks still available.

          Some must really hate it when the facts get in the way.

          Reply
          1. I’ll also add these get the full discount like any other Ram. No full MSRP nonsense.

            Reply
    3. The difference here is, we’re all repeating true facts while you are making a complete idiot of yourself. The 4.3 is efficient, the 5.3 is responsive, and the 6.2 is potent. Here’s an ECOTEC3 4.3 to 60:


      . From my extensive research, real world mileage for the 4.3 is 19/25, real world mileage for the 5.3 is 18/22, and real world mileage for the 6.2 is 16/20. Intake Variable Valve Timing, 9-Speeds, and 10-Speed will bump those rating up by as much as 3-4mpg.

      Reply
  5. The number one priority is to make money then you go for volume.

    How many years GM have large market shares and no profits and sailed into bankruptcy.

    A profitable company is one that makes money then takes that money to grow market share so at this point they have their priorities right.

    Right now Chrysler has to be worried as they are discounting many cars and have always heavily discounted their trucks. Fiat is not making much money either. Jeep is the one bright spot but I fear they may muck it up with some of what I have seen coming from them. The traditional Jeep buyers are not impressed and if they do not draw new buyers in the sure thing at Jeep may be in trouble.

    The Dart while better is not selling and discounted. I expect the same from the 200, Also their RWD line is way over do for a make over and weight loss.

    The Fiat 500 has the dealers upset as they are not moving as promised.

    Chrysler has a lot of work to do and a Diesel half ton is not going to bail them out nor is a discounted Ram. At least GM’s truck price was high enough that even with the discount they now have they will still make more money than ram.

    The recall GM is paying for would have crippled Fiat/Chrysler.

    Ford is doing ok but they have to as they still have major outstanding loans leveraged on their plants. Failure there is not an option.

    If GM can turn a profit paying for the recall now they should have a very good profit once it is done.

    Reply
  6. Fords profit this quarter is going to drop significantly because they have screwed themselves out of truck profits due to heavy incentives. Also because of tooling cost that is coming due from parts suppliers.

    Next I think we will see over $2000 price increases on their new aluminum trucks and the inability to have average incentives due to high material cost.

    Reply
    1. It will be a given that the new Fords will be more expensive and will not see rebates unless inventories grow to levels they can not keep.

      I expect the excitement of the new truck will spur sales but how long will it last at higher prices is the question. How will this effect Fords fleet sales as this is where they move the most trucks and with rebates they move even more.

      Ford also right now lost market ground in the NA market. The recalls they have made them lose money this time around. With the may rebate and hit on the recalls it has taken it’s toll. If it were not for Europe and China it would have hit their stock more than it already has.

      Not everything at Ford it pink smiling flowers. They still have a lot of work to do and a lot of loan to still pay off. There is little margin for error.

      Reply

Leave a comment

Cancel